Wars, Changes and Office 2010, Oh My!

I’m clearly on some kind of twisted Wizard of Oz/magic jag at the moment but, as I said last week, I’m just not convinced people fully get why Apple is successful. However, this week there are some other things brewing. Apple seems to have suddenly become the “Litigation ‘R’ Us” company and every time I’ve seen this happen, it has ended badly.

I was at EMC last week and really got to think about its Acadia effort. I think it has the potential to obsolete more traditional umbrella corporate models like those that HP and IBM use. Finally, Office 2010 is out, and I’m impressed both with the strides the product has made and how nearly utterly clueless Google is with regard to competing with it.

I’ll share my ideas about all of this and close with my product of the week: a book that is timely, given how many people are out of work in the technology market, called Bright Triumphs From Dark Hours.

Apple: Litigation ‘R’ Us

Apple is starting to roll up an impressive number of active wars. The most visible at the moment is with Adobe — the most powerful firm in photo/video editing, and the owner of Flash and Acrobat, both widely used Web and document standards. In addition, it has active lawsuits with Nokia and HTC, and has what appears to be a coming action with the FTC or Department of Justice — and you’ve got to bet the European Commission is in the wings — on antitrust (Adobe is reportedly behind this).

Apple is the gold standard in terms of keeping things simple and focused, but as Intel, AMD, Microsoft and others have discovered over the years, litigation can suck up executive cycles like nothing else. People who clearly have real jobs at a firm, particularly executives, can burn a ton of cycles on just one major lawsuit. We saw the other pirate of Silicon Valley, Bill Gates, try to game the DoJ litigation in the 90s with a near catastrophic result.

Steve Jobs thinks himself to be just as smart as Bill Gates and he has, by far, a greater tendency to try to manipulate the outcome of things. Recall his problems with stock options a decade ago. When you are at the top, as Apple is, everyone is focused on knocking you down, and the only way to stay at the top is to focus yourself on staying there.

Each of these battles by itself is easily within Apple’s capabilities to handle. However, as they start to multiply, the impact becomes multiplicative, and successful attacks in one area may provide examples another attacker can use successfully. For instance a unique attack by HTC could be used by Nokia or someone else.

Microsoft and Intel, firms designed to be complex, were nearly brought to their knees by this kind of thing. Apple isn’t structured to deal with this kind of complex, overlapping, problem structure. I believe the end game is to get a large number of cross-licenses in place, at least with the litigation, and the HTC suite should have been a slam dunk up until HTC sued back. (You have to admire HTC’s guts in responding this way, as Apple clearly has it massively overmatched).

In World War II, Germany got trounced largely because it was fighting too many people at once. I wonder if Apple isn’t making a similar mistake with all of this litigation and conflict at the same time.

Acadia: The New Umbrella Corporation

I’ve done a lot of work both as a consultant and as an employee in large umbrella corporations like HP and IBM. I don’t like the structure because it tends to breed internal conflict, develop massive organizational inefficiencies, hide incompetent behavior and cripple initiative. The whole point to building these companies is to create synergy between the captured companies, called “divisions,” but that rarely results. Instead, you get a big mess that is almost impossible to manage.

Sam Palmisano and Mark Hurd both earn their money several times over (and I’m not on their compensation committees) doing the nearly impossible every quarter. Sony is an example of just how bad these things can get.

What if you were to rethink the structure and create something new that simply focuses on what you’re trying to accomplish — the synergy part of the project — rather than jam a bunch of folks who really don’t want to work together all the time into the same company?

That would be Acadia, which is basically a virtual umbrella company focused on large-scale virtualization and the synergistic relationship between Cisco/EMC/VMware. It will be run by Michael Capellas and largely lack the baggage that screws up most umbrella firms. The CEOs will be peers. When they meet, they’ll be focused on the joint solution, but they won’t be annoyed by each other the rest of the time. While they likely will have disputes — sharing revenue and costs for instance — this seems vastly simpler and more likely to succeed that any other construct I’ve seen.

Large umbrella companies defined much of the last century. This new construct could define this one, and that could be very interesting.

Office 2010 and Clueless Google

I’ve been using Office 2010 for a while and will leave an in depth review of it to others. In short, it is better in almost every way, and the Outlook improvements alone make it worth the price for an upgrade to me. I use Office a lot.

Having said that, there are enough changes to be annoying, and with the complex approval, funding and rollout processes most companies have in place, even if they plan to roll out Office 2010, Google has a massive opportunity to grow share.

Even though it should have seen this opportunity coming for a decade, it is ill prepared for it, and this makes me wonder whether Google is wasting its time in this space.

You see, Google Docs is free. That means employees wanting the features it has — and their aging version of Office doesn’t — are likely to try this product as Microsoft promotes Office 2010, but internal budgeting/rollout policies prevent its use.

I saw this at the EMC event, where a surprising number of employees were using Docs to do what you can do on SharePoint because they didn’t have access to SharePoint. However, because Docs wasn’t that similar to Office, most seemed to go back to Office once the task was done.

This showcases the huge opportunity Google pissed away by not learning the Microsoft “embrace, extend, extinguish” lesson. If it isn’t in the game to play, it should just go home and save us all a great deal of time.

Wrapping Up

When companies become successful and powerful, they can often forget what got them that way, and Apple’s success was largely due to the fact Steve kept the company simple, and he minimized the conflicts — even initially putting to bed the one with Microsoft.

Firms often think the only way to do things is as they have always been done until an innovator like Apple — or in this instance EMC — breaks the mold and tries something different. Firms that don’t learn from others and don’t do what is necessary to take advantage of market opportunities end up like Sun did. Google is increasingly looking like a firm that refuses to learn from the mistakes and successes of others. There are lessons in each instance and we are all, including me, advised to learn them.

Product of the Week: Bright Triumphs from Dark Hours

Steve Jobs, in particular, learned a lot from being fired from Apple, and he came back to become the CEO of the last decade. I know a lot of people who have been fired from their jobs in this bad economy and the stories in the book provide examples of people who were laid low and not only recovered, but also ended up in a vastly better place than they were.

Bright Triumphs From Dark Hours stories include those of Joel Klein, Shirley Ann Jackson, Steve Case and my favorite, Pattie Dunn. I followed HP closely for a number of decades and was very impressed with Pattie’s running of their board. She was backstabbed by several good old boys on the board and contracted cancer at the low point in this story. However, this forced her to rethink her priorities, and she is vastly more active in organizations that help others as a result.

In each case, the tragedy seemed to result in an overall improvement in the person and what appeared to be a happier life than the one that was left. I know that was the case for me, and it appears to be the case fpr Steve Jobs as well. Because my hope for all of you is that you find your way to a happier life, particularly if you’ve been laid off, Bright Triumphs from Dark Hours is my product of the week.